Description

All existing F&O contracts on Hindustan Unilever Ltd will expire on December 04, 2025 and be reintroduced on December 05, 2025 following the demerger of Kwality Wall's (India) Limited.

Summary

BSE has announced adjustments to Futures and Options contracts for Hindustan Unilever Ltd (Derivatives Asset Code: HULL) following a scheme of arrangement involving the demerger of Kwality Wall’s (India) Limited. All existing F&O contracts will be force-expired on December 04, 2025, with new contracts reintroduced on December 05, 2025 (ex-date). Shareholders will receive 1 equity share of Kwality Wall’s (India) Limited for every 1 equity share held in Hindustan Unilever Ltd, with Record Date set as December 05, 2025.

Key Points

  • All existing Futures & Options contracts on Hindustan Unilever Ltd (HULL) will expire on December 04, 2025
  • Derivatives contracts will be reintroduced from December 05, 2025 (ex-date)
  • Record Date for the scheme: December 05, 2025
  • Corporate Action: Issuance of 1 fully paid equity share of Rs. 1 each of Kwality Wall’s (India) Limited for every 1 equity share of Rs. 1 each held in Hindustan Unilever Ltd
  • New strike prices will be determined based on special pre-open call auction session on December 05, 2025
  • Minimum of 7 ITM, 1 ATM, and 7 OTM strikes will be available for trading at 10:00 AM on December 05, 2025
  • Trading in new F&O contracts will commence after the underlying scrip moves to normal market in equity segment at 10:00 AM

Regulatory Changes

No new regulatory framework changes. This is a standard corporate action adjustment as per existing exchange regulations for schemes of arrangement involving demergers.

Compliance Requirements

  • Trading members must inform their clients about the forced expiry of all existing HULL F&O contracts on December 04, 2025
  • Members should ensure proper settlement of all open positions before contract expiry
  • Members must monitor the special pre-open call auction session on December 05, 2025 for price discovery
  • Position management and risk assessment required for all open HULL derivatives positions
  • Trading members should contact their designated Relationship Managers for clarifications

Important Dates

  • December 01, 2025: Circular issued
  • December 04, 2025: Last trading day for existing HULL F&O contracts; all contracts expire
  • December 05, 2025: Ex-date for scheme of arrangement; Record Date; special pre-open call auction session; reintroduction of new HULL F&O contracts at 10:00 AM

Impact Assessment

Market Impact: High - This affects all traders holding open positions in Hindustan Unilever derivatives. The forced expiry of all F&O contracts requires immediate action from market participants to close, roll over, or manage their positions before December 04, 2025.

Operational Impact: High - Trading members need to communicate with clients urgently, manage position closures, handle margin requirements during transition, and prepare for new contract introductions with different strike prices based on adjusted underlying price.

Liquidity Impact: Potential volatility and liquidity concerns during the transition period, especially on December 04 (last day) and December 05 (reintroduction day). The special pre-open session will be critical for price discovery.

Risk Considerations: Traders must assess the impact of the corporate action on their hedging strategies, as the underlying security will trade ex-demerger with adjusted fundamentals reflecting the separation of Kwality Wall’s business.

Impact Justification

Mandatory expiry of all existing F&O contracts on a major stock (Hindustan Unilever) due to corporate restructuring affects all derivatives traders and requires immediate position management before December 04, 2025.